Russian Finance Ministry not proposing progressive income tax scale after 2018

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MOSCOW. Sept 7 (Interfax) – The Russian Finance Ministry has not suggested introducing a progressive income tax scale after 2018.

“We’re not proposing a progressive income tax scale [after 2028]. We’re not discussing one and we’re not proposing one,” Deputy Finance Minister Ilya Trunin told reporters.

The Vedomosti newspaper has quoted sources as saying the Finance Ministry had suggested several ways of boosting budget revenue, including ways proposed in the past that had not been approved. They include increasing key taxes like profit tax, corporate profit tax, VAT, income tax and insurance contributions by 1 percentage point, or reforming the latter; wrapping up the tax maneuver in the oil and gas industry more quickly; raising tobacco excises; introducing excise on sugary drinks; VAT for on-line purchases; making state companies pay more dividends; an end to pension payments for working pensioners with a certain level of income, and others. An official from the government’s financial and economics bloc said raising income tax was unlikely, and that a progressive tax scale from 2019 was more probable.

First Deputy Prime Minister Igor Shuvalov later said the ministry’s proposals for mobilizing additional revenue were not backed and that work on these was ongoing.

Finance Minister Anton Siluanov said in May that his ministry was not drafting any proposals to raise taxes or introduce a progressive income tax scale.